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It's Fun to Play the Piano ... Please Pass It On!

Not teasing at all. I am a professional (read "paid") consultant. I have extensive connections that I have cultivated for many years, including the principals of virtually every piano manufacturer. And I hear many things others do not.

What does it say about a company that thinks it's OK to send out an instrument that someone is expected to pay 50, 60, 70 or $110K for in LESS than 110% "optimum" playing condition? Mind you, they are also not willing to discount a dime off that outrageous price, because, after all......"it's a Steinway"!! From my perspective, the best thing these new owners could do for that company is fire everyone in the New York office/factory and replace them with personnel from Hamburg.

You've been around here for a while so you should be aware that Steinway offers two levels of prep to dealers, no prep and mostly prepped. The difference being that no prep costs less. Consequently that's the one most dealers buy because they figure they can prep pianos for those who are players and save a few $$ (more profit) when someone buys a piano for furniture. The company is not shifting burden to unwilling dealers, quite the opposite!

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

Hi Steve,

Look, it's nice that you get paid to give your opinion to the industry. I'm also a leading expert in one of the fields I work in, with many publications to my credit, so at times I also am paid to give an opinion, often under oath, in front of a judge or a clerk of the court, and with much higher stakes. And for a bigger hourly than you, apparently. You'll find a link to my company bio in my signature line, and I also have a detailed CV in Linked in as do you.

I recognize when somebody is being coy. Fine, be that way.

However, since you are not willing to share your information freely, everything you say is suspect, every single thing. You could be:

1- Just trying to get attention for yourself and thereby promote your own brand, or

2- Shilling for the New Steinway to protect the brand, as a paid consultant. Either way, it's a complete waste of our time.

I do hope you'll forgive my and other people's cynicism on this count. You've posted here many times in a way that was exemplary. But, really, your behavior right now is driving me and a few others to doubt you. It looks like you might still be working solely for the industry, the way you're posting. Since you won't say anything, how do we know your posts here are not just another (paid) bullet-point of a larger PR campaign to maintain sales of an (now) ailing brand during transition? Many of us have seen this happen far too often to pretend this is not likely.

Such behavior gives the piano industry a bad rep.

I am unimpressed with your claims of "long-range planning". The principals are not Japanese, who do this on a consistent basis and with some limited success. Westerners are constitutionally or philosophically incapable of doing anything close to it. Not to mention that not even the Japanese expected their economy to be in a stagflationary slump for 10+ years because they planned wrong this once.

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

You know, it just occurred to me:

If the New Steinway brand, post-acquistion, continues to put out mediocre instruments or worse, all we're going to do in our comments here is kvetch and complain about how dismal the New Steinways are, sort of how we've been complaining, only more so, much much more.

Something for the "industry" to consider...

...do you think they actually read these posts...

...oh my...

...if that happens, are you going to sue Piano World like those other industry reprobates? Case law stands against the approach...

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

Hi Bob,

Since the press release has already gone out on several media organs, it's a safe bet that the deal will go through. BTW, I don' think Samick can offer the same deal as Kohlberg. Since the S&S is publicly traded, the SEC will have a lot to say about how the deal is settled, which may preclude choosing one buyer over another based on industry standing or philosophical intent.

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

Oh, of course they can, as they are publicly traded and therefore the sale is governed by the SEC. But that's just like the last time I submitted a government bid. Before I got to the first bid/procurement meeting, and even though my company was obviously the best service provider among those who were bidding, the department had already picked their preferred vendor, before RFQs were even issued. There was nothing I could say or do.

I was in the Steinway showroom on 57th Street last month with a student. We tried out every grand on the main floor, focusing primarily on the B and D models.

There was only one rebuilt instrument on the floor on that day - a Steinway C, I think around 1890 - that triumphed over every grand in the showroom, and triumphed by far. There was simply no comparison. I have encountered this repeatedly with excellent rebuilds of large Steinway grands of the pre-war era. That bronze tone is unique and magnificent, fully justifying the legend of Steinway.

I would be delighted if some billionaire bought up Steinway for the sole purpose of restoring Steinway to its former glory. But I have not gotten any indication that this is what is happening, although I would be happy to be proved wrong.

BTW, the uprights carry rather aristocratic price tags, and I would not put forth that kind of money when I know I could get better tone for less dollars elsewhere.I don't like to criticize like that, but I have had to guide students to other makers because of this (and I do not take commissions on sales).

So we have, on the one hand, a consultant on repetitive stress injury; and on the other, a widely recognized authority on piano industry operations, practices, and strategic planning.

If I have a question about repetitive stress, I know exactly who I'll be calling.

In the meantime, as someone who has practiced a lot before the SEC, let me tell you that the SEC could care less about merits of an acquisition bid or the strategic visions of competing bidders. That's not what the SEC does.

Rather, their interest is in making sure that the required disclosure documents satisfy the rather technical disclosure requirements of the federal securities laws. If they do, then the SEC won't give a fig about what will happen to the acquired company under one scenario or another. Under the securities laws, that's for the market to decide.

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

Hi Classic,

I'm with you on that score. The SEC will let the market decide. Eeeewwww, how nasty....the Market is never kind to Art....

...thank you for proving my point for me again, especially about the bottom line...

BTW, if you ever have a hand or wrist problem, call me first. I'll give you the first hour for free (and I don't give that to just everybody, the law usually prevents it...). I won't bother to lie to you...

BTW, I would LOVE to be proved wrong about this. When will we read something from the industry experts that will convincingly contradict what I've been posting?

laguna_greg
1000 Post Club Member
Registered: 04/02/13
Posts: 1507
Loc: guess where in CA and WA

Originally Posted By: jmcintyre

e under a non-disclosure agreement if he's a paid consultant. His statements are suspect only to the extent to which you're suspicious of them....

Hi JM,

Which means that, if he has indeed signed a non-disclosure agreement, every public pronouncement he makes must satisfy and protect his contracted and de facto or implied fiduciary interests to all the signatories, not to ours...which makes him a shill for industry, as I said earlier...

"I don't know who you are. I don't know what you want. If you're looking for ransom, I can tell you I don't have money but what I do have are a very particular set of skills. Skills I have acquired over a very long career. Skills that make me a nightmare for people like you."

"Market Place" on NPR had an interesting viewpoint on the sale. They seemed to indicate that the investment group is looking for "Luxury" manufacturers and want to polish the image and not destroy the company. They are going after high tag portfolio investors who get in their private jet to go pick out a Steinway. They also indicated the growing market in China is a target and that there is the cash available for individuals to buy an 'imported' piano. It really didn't seem like S&S would start building in China. Essex already caters to a specific market very well.

I am glad the new owners have a dream, but it isn't like the previous owners didn't have this vision and execution strategy either. I saw Steinway ads in Asia during my last travels there, Steinway is already leveraging their name into other products. Sure, the new guys think they are going to do it mo fasta, mo betta. But, with more debt. I don't see the net good, but time will tell.

You've been around here for a while so you should be aware that Steinway offers two levels of prep to dealers, no prep and mostly prepped. The difference being that no prep costs less. Consequently that's the one most dealers buy because they figure they can prep pianos for those who are players and save a few $$ (more profit) when someone buys a piano for furniture. The company is not shifting burden to unwilling dealers, quite the opposite!

If that's truly Steinway New York's business model, then they are even bigger fools than I suspected. You place the reputation of your company and product in the hands of dealers who could care less? Ask Rich Galassini or Ori Bukai if they would EVER consider placing one of the incredible instruments on their sales floor in LESS than optimally prepped condition, in the hopes of selling it to some "furniture" customer.

The "What" is that as a company Steinway is hurting and probably can't survive much longer in its present condition (business model, way of working, current and anticipated market, etc.) it therefore needs some sort of a "turnaround".

The "How" COULD (may or may not) mean extending "down market", asset stripping, whatever all else. Kinda depends on what the new owners' motivations are and we are GUESSING on those. Not saying our guesses are right or wrong, not saying that the new owners have fully formed their plans yet, just saying that WE are guessing WRT the "How".

OTOH maybe they are going the way of Kodak;I dunno bout this Polaroid stuff and digital cameras and such, but we have been in wet photography since the beginning and the Brownie brought home snapshots to EVERYONE.

Greetings, There are many avenues down which Steinway and Sons may be taken. For the musician, the desired route is the one that leaves us with dependably consistent, even, responsive, instruments. There is only one way for that to happen, and it takes faith to make the investment.

The only way to glory is if the new owners decided to invest more money in improving the skills of the people that build these pianos, and spending the time required for them to operate at the 100% level. It would mean scrapping more plates, rims, wood, etc, to keep the quality as high as it was in the 1920's. These pianos are handmade, and their quality reflects, in a manner becoming increasingly rare, the direct manual skills of the assemblers. A happier bellyman is going to do a better job notching that bridge.

The amount of time given the workers, and their attitude towards their work, shows up in these pianos. If the new owners want to keep the reputation, they will have to invest after the purchase. If the purchase was all the investment the new owners are willing to make, we will see the name watered down and the marque begin its drift backwards through history.

... kinda depends on what the new owners' motivations are and we are GUESSING on those...

Quite right, guesswork is so much fun.

Kohlberg appear to have a well established business model and you can see how they apply it by looking at their investments, all emblazoned across their website.

The press release clearly states their intentions - but nobody believes a word of that, do they?

When you spend $400 million on a brand like Steinway and your aim is to maximize what it realizes in a few years time, what would you do, and why should Kohlberg do anything else - unless they are incredibly smart or amazingly stupid?

Of course they may strip out under performing assets, flog off the instruments, introduce better business practices, but won't the price new owners are prepared to pay for Steinway ultimately depend the quality of the pianos?